Sources of Revenue

For the first phase of implementation, 2010-2015, CAUSE will be financed through current Medicare and federal Medicaid expenditures and through imposition of a financial transaction tax of 0.5 percent on sale of stocks, smaller fees on trading of government and corporate bonds, futures contracts, swaps in currency and options, and by increasing taxes on tobacco products. This new tax will raise a projected $120 to $150 billion dollars annually for CAUSE.

Healthcare efficiency improvements and early impacts of preventive measures will cover much of the additional costs during the next two phases of implementation. At full implementation, after 2025, additional sources of revenue will be required. Other sources of revenue will consist of increasing the payroll tax to employers by 3.3 percent, providing $500 to $600 billion dollars annually.

Finally, it may be necessary to include a 2 percent national sales tax so that everyone, regardless of income or citizenship status, contributes to the cost since all U.S. residents and visitors purchase goods and services; this will exempt non-discretionary items such as groceries, utilities and housing. In considering these additional taxes, reduced individual and employer costs for health care and net reductions in the total costs of the health care system in the U.S. must be taken into account.